Kraken Lawsuit Dismissed as SEC Withdraws Charges and Case

• SEC drops Kraken lawsuit, marking a major shift in crypto regulation strategy.
• Kraken wins as SEC withdraws charges, with no penalties or operational changes.
• SEC ends multiple crypto firm lawsuits, signaling a shift in enforcement priorities.

Kraken received a court order from the U.S. Securities and Exchange Commission (SEC) to dismiss its legal case on March 3, 2025. Through this regulatory shift, the agency now adopts a different method for digital asset supervision. The SEC has accused Kraken since November 2023 of running an unregistered securities trading operation along with a broker service and clearing agency.

According to the SEC, Kraken denied crucial investor safeguards through its operations. Kraken contested the charges, arguing the SEC failed to provide clear regulatory guidance. The exchange filed a motion to dismiss, which a federal judge partially upheld. The SEC has dropped the case with prejudice meaning no penalties or operational changes apply to Kraken. The company hailed the outcome as a step toward a more predictable regulatory framework for cryptocurrencies in the U.S.

Broader Changes in SEC Crypto Enforcement

The Kraken case is not an isolated event. Over the past week, the SEC has terminated at least six legal actions against crypto firms, including Coinbase and MetaMask. Additionally, probes into Gemini, OpenSea, Tron Foundation, and Robinhood have ended. This wave of dismissals follows years of criticism over the SEC’s enforcement-heavy strategy under former Chairman Gary Gensler, who left the role earlier this year.

Industry leaders and lawmakers long argued that such tactics hindered innovation without targeting genuine fraud. The shift, led by Acting Chairman Mark Uyeda, suggests a rethink of priorities. For instance, a recent court loss against HEX founder Richard Heart further exposed weaknesses in the SEC’s approach. Given President Donald Trump’s crypto-friendly stance, only the Ripple XRP lawsuit remains active, though speculation grows that it too may soon conclude.

Signs of a New Regulatory Era for Digital Assets

The SEC’s retreat aligns with broader moves toward crypto clarity in the U.S. On February 7, lawmakers introduced a stablecoin bill to strengthen the dollar’s global role. A more comprehensive crypto regulation bill, building on the FIT21 framework, may follow. President Trump, who took office in January 2025, has vowed to make the U.S. a global crypto hub, proposing a strategic reserve featuring Bitcoin, Ether, XRP, Solana, and Cardano.

Leadership at Kraken considers the dismissal of the initial case to be a pivotal event. Senior advisor Marco Santori from the exchange commended their legal team after the court dismissal while acknowledging its future implications. The White House Crypto Summit will occur on March 7, while experts predict subsequent policy changes from this event. The regulatory changes indicate a possible conclusion to long-standing market uncertainties in the United States, which brings hopeful prospects for expansion to the industry.